GBP/JPY Price Analysis: Pound to drop further with a consolidation under 162.00

• GBP/JPY is moving sideways in the short-term with a bearish bias.
• Daily close under 162.00 to open the doors to more losses.
• Key resistance is seen at 163.70 and 164.50.

The GBP/JPY is falling on Tuesday, trading around 162.50. It bottomed at 161.85 and quickly rose back above 162.00. The 162.00 area has become a critical level and a daily close below should open the doors for an extension of the decline, initially to 161.20 (100-day Simple Moving Average). Below, there is not much support until 160.00.

Technical indicators in the daily chart are biased to the downside. RSI and Momentum are pointing south, and the price is below the 20-day SMA. A recovery above 164.70 could change the short-term outlook.

While the pound resists above 162.00, the odds of more range trading between that level and 163.80. A daily close above the mentioned level should clear the way for 164.70. Above the next critical target is a downtrend line from June highs currently at 166.55.

GBP/JPY daily chart